FINANCE

What would Hawaii’s economy be without tourism? People may differ in their answers, but at more than $14 billion in visitor spending and comprising 17 percent of state GDP (gross domestic product), this story line is clear: Tourism drives Hawaii’s economy. While we might hope for greater diversity in our economy in the future, achieving that diversity can be achieved only by using the economic drivers we have today as a bridge to tomorrow. The world today is truly global and brutally competitive.

It’s essential that we intelligently care for the drivers of our economy both for today and for the future. Our visitor industry also provides a wonderful channel by which to share our beautiful culture with a world increasingly beset by hostility.

Although all economic sectors are important, there is no other single sector that is more critical to the state’s well being than our tourism industry.

While nobody disputes the appeal of a well-diversified economy, tourism is where Hawaii’s true comparative advantage rests. Without a strong tourism industry, we’d be much more dependent on the military, which, while immensely important in its own sense, can be precarious in these austere times.

The banking and tourism industries enjoy a symbiotic relationship. A thriving tourism market leads to a healthy economy. And, as our local economy goes, so goes our local banking industry. Ninety percent of our subsistence at Bank of Hawaii comes from the Hawaii community and economy.

Many of our customers are employed directly or indirectly in tourism-related fields. These customers have credit cards, mortgages and auto loans, and utilize other financial products and services as well. Many of them are also small business owners serving the hospitality industry. There is a lot riding on keeping our islands a destination of choice, whether for leisure or business.

The economic multiplier effects that spread throughout the economy touch areas such as retail, construction, real estate development, transportation, entertainment, professional services and suppliers.

Even energy costs are supported by the visitor industry, as those power bills support fixed overhead and capital outlays. While it’s difficult to precisely and fully quantify the breadth of the impact, its significance cannot be dismissed and should not be ignored.

When visitors stay away, there is a reverse domino effect. Unemployment or reduced hours at hotels, restaurants, retail shops, means people are unable to repay their debt. It’s a simple truth. People need income. Weakness in Hawaii tourism affects everybody because it results immediately in lower tax revenue. This means that government has less to spend on public projects for communities.

When tourists began returning to Hawaii — and in record numbers in 2012 — we knew it wouldn’t be long before the state would start to see the positive effects. Business owners feel more confident. Hiring picks up and businesses look to expand.

Lending does not drive the economy. It is the activity within the market that motivates the desire to borrow. Bankers work closely with borrowers to provide the capital to facilitate their investments. That is exactly what we’re seeing now.

Our visitor industry has helped to build "Hawaii," "aloha" and the "aloha spirit" into global brands of immense value.

This brand value has helped bring international investment onto our shores. These investment flows create jobs. As importantly, our export of aloha and the aloha spirit is an important gift to a world increasingly confronted with issues of diversity and tolerance.

Since its ascent beginning with the jet age in 1959, tourism has become an indispensable economic pillar — a pillar in a long list of pillars that have supported our islands over the years, from sandalwood to whaling to sugar to pineapple to military.

Someday, the next sandalwood opportunity will wash upon our shores. Until then, the visitor industry deserves intelligent attention and support from business, labor, government and the community for all our sakes.